How can I invest more money in the existing SIP?

Short answer - Start another SIP with the amount you want to increase by.

It might be a good idea to invest excess/surplus funds into mutual funds, more so if one has an existing SIP ongoing. Best idea would be to invest in a new SIP, with or without continuing the existing the existing scheme.

Start a new scheme

Usually, at the time of beginning an SIP, an investor is required to a Electronic Clearing System (ECS) form, wherein bank is given permission to transfer the amount of SIP due each month to the bank account of mutual fund. Since bank automates this process, it can be difficult to change the amount of SIP to be debited each month midway during the tenure of the SIP. Most fund houses do not allow the change in the amount of SIP midway. Therefore, investor may have to start a new scheme.

One can view potential good SIP investment options here.

In future, it is expected that change the amount of investment in SIP shall be made more flexible, making it easier for investors to manage the liquidity of their funds vis-à-vis investing in mutual funds. 

Yes, you can definitely invest more money in existing SIP. Following are the methods through which you can do it:

1) If one wishes to increase their investment every month, then you can enter top-up or step-up facility. It is important that as your income grows, the quantum of investment should grow too.

2) You should be checking this with your financial adviser o distributor about the top-up facility available for your mutual fund scheme or no.

3) There are two ways to step-up your SIPs every year. The traditional option is to simply decide how much more money per month you'd like to invest and then start a fresh SIP. You can do that either in the same scheme (but the SIPs won't get clubbed) or in another scheme in the same portfolio.

4) If, however, you have an existing SIP and you want to increase your monthly contribution, very few fund houses allow you to do that midway. However, most fund houses allow you to decide the top-up amount right at the time when you start your SIP, before you pay your first installment.

5) Every fund house has a common application form as well as an SIP form. In the SIP form, after you fill your basic SIP details like start date, monthly investment amount and SIP end date; there are a few other details right below these that ask you if you'd like to top-up your SIPs in the future.

6) Some fund houses allow you to top-up every 6 months; many others allow you an annual increase. In simple words, every year, once a year you can increase your amount and then that increased amount will be your monthly investment for that year. The following year, again, your amount will increase once, to be valid for the remainder of that year.

7) Investing 20,000 as a whole in the same SIP can be an option provided the details given above and pertaining to the mutual fund scheme you are investing in. So, take proper advice from your financial adviser and then invest in.

However, it is easier to simply start a new SIP with the increased amount instead of bothering with increasing or topping up an SIP. This is in author's view.

Happy investing.

Investing in SIP is considered most favorable as it allows the investor to invest as little as ₹500 each month. However, the investor may want to increase this amount for various reasons ranging from a desire to earn superior returns, to meet some financial goal, to save more due to increased income, or to beat inflation. Increasing the amount in existing SIP is typically a cumbersome process. It is therefore advisable to start a new SIP with the amount you want to increase your existing SIP by.

Having said that, the investor has the option to increase the existing SIP amount by opting for top up at the time of opening a new SIP. The periodic top up option enables an investor to increase the amount of SIP by a fixed amount after specified time intervals. However, such option can only be availed at the time of applying for an SIP. The top up can be done after every 6 months or one year.

For example, an investor who has started an SIP of ₹5000 and availed a one year periodic top up of ₹500 will have to invest ₹5000 each month during the first year of SIP, ₹5500 each month in the second year, ₹6000 each month in the third year and so on till the maturity of the SIP.

An application must also be given to the bank that transfers funds from your account to the fund house for a revision in the said amount.

If you wish to stop topping up your SIP, you need to cancel the existing SIP and start a new one. There is no recourse available if the top up option was not availed at the time of starting the SIP.

In order to avoid such complicated and time consuming process, simply opt for a new SIP for the increased amount.